OWNER REWARDS TENANT’S LOYALTY
FIRST-TIME investor Mohamed Radwan could have upped the rent on his Pimpama property by more than $100 a week.
But buying in a renters’ haven meant he could opt instead for a modest increase, keep the long-term tenant, and still be confident of a strong return.
Houses in Pimpama were one of the nation’s top choices for investors, offering rental yield of 4.87 per cent, REA Group data shows.
The northern suburb has one of the lowest median house prices on the Gold Coast at $572,000 and ranked 12th nationally for the highest number of inquiries in February.
Mr Radwan, a chartered accountant, bought a four80-PAGE GLOSSY MAG bedroom house in Pimpama in May 2021 for $485,000 from the original owner. The property had been leased to the same tenant since 2012 for $425 a week.
A rental appraisal showed similar homes were leased for $550, but Mr Radwan only increased the rent to $460 a week.
“This was still way under market return, but for me because the tenant is loyal
I preferred to have a good tenant and lower rent, than a bad tenant with expensive rent,” he said.
“The yield in Pimpama overall is good compared with other suburbs, so even at $460 I had a good cashflow positive rental return compared to the purchase price, especially with low interest rates.
“I was researching in other areas as well, and the reason I chose Pimpama was that it was a well-developed area with many amenities, like good soccer fields and access to the motorway, and everything looks new in the suburb,” he said.
Mr Radwan offers tax advice on property development and investment through a division of his accounting practice, MAR Advisory.